Agenda item

This report details how the Housing Revenue Account revenue and capital budgets have been drafted and explains the business objectives for the Housing Revenue Account in 2011/2012.

Discussion:

The Assistant Director, Housing and Corporate Services introduced the report reminding the committee that it was asked to recommend to Cabinet its preferred rent increase for 2011/2012 from the three options detailed in paragraph 3.3 of the report, together with the increase in service charges from 2011/2012 to 2014/2015 inclusive.

Officers advised that there was now a Housing Asset Management Strategy and Business Plan. This was the first time a strategy had been collated which included the condition of all the housing stock giving a clear understanding of the remaining life of all assets and that this meant that housing maintenance could be more planned and structured.

The Chairman invited Mary Butcher, a member of the new Residents Forum, to address the committee to comment on the housing budget. Mrs Butcher advised that a meeting had been held between the Sheltered Forum and the Repairs Forum and Caretaking Forum where it was agreed that rents would have to increase recognising that Medway had some of the cheapest rents in the south east of England. It was also agreed that service charges should increase to make up the shortfall that was required to pay for the service. She added that most tenants were very pleased with the service they received and that she hoped that this would continue to improve.

Members asked for clarification as to whether the Supporting People Grant remained ring-fenced and the Chief Finance Officer responded that this specific grant no longer existed and had been consolidated into the general funding. Members also asked how many residents would be affected by an above average rent increase in order to judge the scale of the impact of the rise. The Chief Finance Officer replied by clarifying the information detailed in Appendix D (page 115 of the supplementary agenda) and confirming that the vast number of properties would receive an increase of between 5 – 5.99% which equated to a £3.01 - £4.00 per week increase.

The committee raised concerns about costs for refurbishment works penalising tenants who kept their properties in good condition. Members suggested that officers consider the introduction of a Tenant Reward Scheme for keeping their properties in good repair.

Decision:

The committee agreed to recommend to Cabinet:

(a)         the proposed revenue and capital budgets for 2011/2012, inclusive of an average rent increase in line with option 3 (as detailed in paragraph 3.4 of the report) of £3.63 per week (based upon 50 collection weeks and equating to an increase of 5.16%);

(b)         that service charges for 2011/2012 reflect the costs incurred in providing that service, where possible, and that where costs are not fully recovered, the uplift is such that costs can be fully recovered by 2014/2015 using above inflation increases to do so as per Appendix C to the report. The average increase will be 7.56%;

(c)         to increase the service charges in 2011/2012 to 2014/2015 inclusive at levels shown in paragraph 4.3 of the report, in order that the true costs of providing services are recovered.

The committee also agreed:

(d)         that the Housing Asset Management Strategy and Business Plan is reported to the next meeting of the committee for consideration;

(e)         that a Tenant Reward Scheme for keeping property in a good state of repair is added to the Housing Asset Management Business Plan for consideration by the committee at its next meeting.